Making the Investment – How to Efficiently Plan for Your Future Vacation Home

You may have heard the famous statistic first stated by Andrew Carnegie that 90% of the world’s millionaires earned their fortune investing in real estate.

You may have also heard another old saying “it takes money to make money”. While this is somewhat true, it doesn’t mean that you need to have hundreds of thousands of dollars available to invest in real estate.

Anyone can invest in real estate with a little planning. Keep reading to learn how investing in a vacation home is the best investment for your future.

Real Estate Is a Solid Investment

First of all, why real estate?

In general, real estate always has and always will be a solid investment. Unlike stocks or other paper forms of investment, real estate is tangible and has its own inherent value.

While it’s possible for real estate prices to go down for a while, your investment is almost guaranteed never to be worthless. Plus, if you wait a little while for market conditions to change, it’s likely you’ll see your investment value go back up.

You Don’t Need a Lot of Money to Begin

It might seem counterintuitive to say you don’t need much money to invest in real estate. After all, even a small condo can set you back $100,000, depending on its location.

Renting a piece of property generates a steady stream of income each month. If you have a strong financial profile (good credit score, steady verifiable income, etc.), you can invest in real estate with the bank’s money. No one will lend you money to invest in the stock market, but there are plenty of lenders out there willing to lend money for real estate.

If you earn enough income from your rental, you can pay the mortgage on the property each month without spending your own money. Play your cards right and you may even earn extra.

Once you’ve paid off the bank loan, that rental income now goes right into your pocket and you own a valuable piece of property.

Renting a piece of property generates a steady stream of income each month.

Your Investment Appreciates Over Time

Rental income isn’t the only money you can earn from your property. The value of real estate continues to appreciate over time. Thus, you will almost always sell your property for more than you paid for it.

This is especially true in areas where there are vacation homes. These are typically nice areas with either natural or manmade attractions that become more popular year after year. As more people come to visit, the economy gets stronger and property values rise.

When you sell your vacation home, you can keep the profit — perhaps to fund your retirement. Or you can turn around and invest that money into a nicer property that you can rent for more money, generating a higher stream of monthly income.

You Can Earn More Renting a Vacation Home

Many people purchase single-family homes or a condo that they can rent out for people to live. Signing a 6-month or year-long lease feels a little more secure than renting by the week or night.

This is generally true and as long as you have good renters, you’ll get a steady stream of income with little effort. You might have to fix a leaky pipe here and there but you don’t have to be on the lookout for new tenants all the time.

However, long-term renters come with their own set of problems. There is more chance that a disgruntled renter will inflict damage to the property on purpose. Or if they stop paying their rent, it is very difficult (and expensive) to evict them.

You can charge a much higher nightly or weekly price to rent a vacation home. Some of that money goes to extra expenses like cleaning, but as long as you rent it out regularly, you’ll generally see a higher profit than when renting long-term.

Of course, finding new tenants all the time is what scares some people off. However, you can mitigate this by hiring a property manager. Even after paying their expenses, you can see higher profits if your manager is good at marketing your property.

When you sell your vacation home, you can keep the profit — perhaps to fund your retirement

Your Investment Comes with a Vacation Home

There’s a cool bonus that we haven’t mentioned yet. When you buy a luxury vacation home, you get to use it! So the next time you go on vacation, you don’t have to pay to rent accommodations.

Buy your vacation home in an area that you enjoy visiting. The Sycamore Resort in Kissimmee, Florida is a place that many people love. With easy access to beautiful beaches and other natural attractions, world-class shopping and restaurants, and a variety of popular theme parks including the Magic Kingdom, Seaworld, and Universal Studios, it’s easy to see why.

The resort itself is also bursting with amenities, guaranteed 10% returns for two years with their leaseback program, and a variety of floor plans to choose from.